1.2% rise in UK retail sales

The ONS (Office for National Statistics) have revealed High street sales rose by 1.2% in August which is 3.3% higher than a year ago. Analysts had predicted a 0.5% drop after several gloomy surveys.

Clothing and footwear sales led the increase followed by back to school shopping – this is despite reports that consumers would be cutting back because of the current economic gloom and doom.

Consumers are cutting back on food spending which fell slightly by 0.2%.

While the latest monthly figures are positive, sales in the three months up to August fell by 0.8% compared to the previous three months which is the largest dip since November 1990.

Analysts are saying that following the latest bad news from the banking and finance industry it is very likely that retail sales will drop over the next few months. Consumer confidence is running low due to rising inflation, loss of confidence in the banks and rising unemployment.